Does John Boehner know what paychecks are made of?

By Felix Salmon
July 8, 2011
jobs report.

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It’s incredibly difficult to work out what is the most depressing part of today’s truly gruesome jobs report. The shrinking number of people in the labor force? The rise in U-6, broad underemployment, to 16.2%? The sharp spike in the newly unemployed? The downward revisions to April and May? The downtick in total hours worked? Maybe it’s the way that people leaving government jobs, for whatever reason, are finding it impossible to find new jobs in the private sector.

For me, it’s none of these things — it’s not, in fact, anything inside the report at all. Instead, it’s the reaction to the report from John Boehner:

“The American people are still asking the question: where are the jobs? Today’s report is more evidence that the misguided ‘stimulus’ spending binge, excessive regulations, and an overwhelming national debt continue to hold back private-sector job creation in our country. Legislation that raises taxes on small business job creators, fails to cut spending by a larger amount than a debt limit hike, or fails to restrain future spending will only make things worse – and won’t pass the House. Republicans are focused on jobs, and are ready to stop Washington from spending money it doesn’t have and make serious changes to the way we spend taxpayer dollars. We hope our Democratic counterparts will join us and seize this opportunity to do something big for our economy and our future, and help get Americans back to work.”

Opinions of the budget deficit and the national debt differ — some people think they’re a huge and important issue which needs to be dealt with in an urgent and serious way, while others think that the whole issue is overblown and that the debt is doing little if any harm at all to the US economy. But whichever side you stand on that debate, it’s downright bonkers to think that, at the margin, government spending reduces job creation, while pushing for ever-larger spending cuts is the way to be “focused on jobs”.

As Paul Krugman has explained extremely well, the economics of the deficit are not entirely obvious, and the president is no natural Keynsian.

The president just doesn’t like the kind of people who tell him counterintuitive things, who say that the government is not like a family, that it’s not right for the government to tighten its belt when Americans are tightening theirs, that unemployment is not caused by lack of the right skills. Certainly just about all the people who might have tried to make that argument have left the administration or are leaving soon…

To commenters saying that I need to have dinner with the president, or vice versa — been there, done that, didn’t help.

But if Krugman’s Keynsianism is unintuitive, the Republican stance on jobs is downright incomprehensible. Paychecks are made of money: they’re spending. If you spend less, you get fewer and smaller paychecks.

“Spend less money, create more jobs” is the kind of world one normally finds only in Woody Allen movies, and it’s a profoundly unserious stance for any politician to take. Spending cuts, whether they’re implemented by the public sector or the private sector, are never going to create jobs. And there’s simply no magical ju-jitsu whereby government spending cuts get reversed and amplified, becoming larger private-sector spending increases.

Boehner’s rhetoric, here, is a cynical play on our nation’s economic illiteracy. But the jobs crisis is far too big and too important to become a tactical political football. Now more than ever, it’s the job of government to come together and to do something constructive to create high-quality, long-term employment. Fast. Instead, the House majority is giving us aggressively harmful stupidity. Today’s a bad day in the annals of job statistics. But it’s equally bad in the annals of public service.

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Comments
53 comments so far

Danny, you are the first person in the whole thread to use the word “unregulated”, so I’m not sure which market you’re talking about. Assuming you’re on your usual hobby-horse about the poor unfortunate bankers, you’re right, it was because banks were so regulated that dozens of them failed, causing massive economic damage. The government practically forced them to abandon underwriting standards, spend all their time structuring socially useless derivatives products, and destroy most of their own capital.

If I actually believed that you were a laissez-faire capitalist I would at least find you intellectually honest (although mistaken). But we all know that you want the government to support banks and enable their profiteering without actually subjecting them to regulation. You are a consistent advocate of the worst kind of crony capitalism.

Posted by najdorf | Report as abusive

y2kurtus, when we speak of the environment, BP and fracking, those are issues that should be of concern to everyone, especailly those in the industry. BP’s spill was caused by LESS regulation, as Bush and Cheney were all for giving oil free reign and profit is the only focus.

Everyone in the industry should be more wary of the contempt of the people and the market and environmentally regulate themselves … but they already proved they can’t.

PS: Drilling twice as fast doesn’t necessarily equate to more jobs… just more profit.

May your pipelines be fracked for using that as a basis for argument.

Posted by hsvkitty | Report as abusive

@hsvkitty,

BP and fracking and the enviroment are of concern to everyone, myself included, that’s why oil drilling and shale gas exploration are heavily regulated. I’m not for one instant saying that they should be unregulated.

I was challenging the obvious fallacy that regulations don’t affect investment and employment.

In some instances regulation might actually increase employment. In my state they have reduced the number of lobster traps allowed per lobster licence several times. This has allowed more people to make a living in the lobster business at the expense of the really ambitious hard working lobstermen that use to fish 16 hours a day 6 days a week.

@DanHess total kudos to your ideas. I agree with your assessment that energy scarcity will dwarf all current issues much sooner than many expect. Lets change some regulations and put wind turbines up in all but the most critical envriomental areas of my state and solar farms in all but the most critical areas of the arid southwest.

Posted by y2kurtus | Report as abusive
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